$456M Diverted? Justin Sun Claims Address Swap In FDT Scandal

Key Insights:

• Justin Sun has accused First Digital Trust of diverting $456M, which was meant for investment in a Cayman Islands fund.
• Sun claimed the funds were instead sent to a Dubai-based company with a similar name controlled by a related party.
• He compared the alleged act to a blockchain-style “address replacement” attack used to misdirect digital assets.

Justin Sun has accused Hong Kong-based custodian First Digital Trust (FDT) of orchestrating a $456 Million fund diversion. 

The founder of TRON outlined an alleged scheme involving misdirected investments, secret accounts, and kickbacks. The dispute has escalated into a legal battle, with both sides taking firm positions and filing lawsuits.

Justin Sun Alleges Address Swap Tactic in Fraud

According to Sun, the controversy centers around a transfer meant for a Cayman Islands mutual fund. In his Congressional testimony, Justin Sun stated that funds were transferred to a Cayman Islands mutual fund. 

He revealed that these funds were then redirected to an entity in Dubai with a different name. Blockchain thefts typically result in “address replacement” incidents, as he established during this investigation.

His understanding of the matter came from the similarities between Aria Capital Management Ltd. and Aria Commodities DMCC. The writer determines that unauthorized personnel received funds from a third business owner while under their influence. 

The diversion of funds became possible due to a slight modification between the intended and actual payment recipients. According to Justin Sun, the $456 Million was designated for a Cayman Islands fund Brittain operated. 

Brittain’s wife, Cecilia, was linked to the Dubai entity that received the funds. This differed from the expected recipient, a Cayman Islands fund overseen by Matthew Brittain. He described this deceptive practice as intentionally deceiving stakeholders and avoiding oversight.

Sun describes the fraud as an organized scheme that internal company personnel might have mounted. 

TRON founder maintains that FDT management joined actively in running the transaction procedures. Justin Sun stated that FDT senior executives violated their duty to safeguard client assets.

FDT Leadership Named in Secret Kickback Scheme

Sun exposed others besides Teng for involvement in various scandals during his allegations. Justin Sun identified three individuals involved in the fraudulent scheme: FDT CEO Vincent Chok, Yai Sukonthabhund, and Alex De Lorraine. 

They reportedly received substantial kickback payments as part of the operation. Vincent Chok admitted to overseeing over $15.5 Million in transfers to a concealed account. This acknowledgment came from his statement regarding the operation.

Sun claimed that the Glassdoor account operated by Hong Kong was used to mask income. Aria DMCC was the financial source of the undisclosed funds he alleged were illegally obtained.

The evidence suggests FDT leaders were fully aware of and motivated personally by their alleged fund theft. Sun claimed the leadership intentionally made this transfer to generate profit for a restricted group. 

Justin Sun employed the naming correlation between the entities to demonstrate the existence of deception. These techniques achieve their goal by hiding behind minor variations to deceive people. His belief expressed a resemblance between this method and crypto-related address manipulations.

According to his description, the trusted financial operators took measured risks through this method. Traditional systems have allowed what Sun considers to be digital-style fraudulent execution, according to his belief. According to him, the internal checks failed because employees who operated as insiders chose to ignore them.

Justin Sun Launches $50M TUSD Recovery Plan

First Digital Trust decided to pursue legal proceedings in Hong Kong after public statements of accusation against the company were published. First Digital Trust submitted a defamation lawsuit to the courts, which included a court order request. 

According to FDT, Sun falsified the information, harming the company’s reputation. Both custodians denied any misconduct in their business tasks while insisting on complete business solvency. 

The company defended its financial state by arguing its misrepresentation alongside wrongful accusations against its honorable staff members. FDT asserted its stance using the legal system and stressed the importance of transparency.

The firm’s legal representatives declared that Sun’s public statements caused market confidence to wane. Sun’s posts about FDUSD briefly deviated from its peg, drawing more attention to the situation. The stablecoin reversed its deprecation, and its value reached $0.9987 when the latest updates occurred.

The Recovery plan did not faze Sun as his organization continued its momentum. The money offer amounted to $50 Million to find and restore all missing funds from TUSD reserves. 

According to Justin Sun, the process would stabilize stablecoin trust by promoting transparency and building stability in the token.